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 TENEX » Dear Readers » Appendices » Appendix No. 6. Observance of the Corporate Code of Conduct
 

Appendix No. 6. Observance of the Corporate Code of Conduct

Provision of the Corporate Code of ConductObserved / Not
observed
Note
General Shareholders’ Meeting
1. Notification of shareholders about the General Shareholders’
Meetings at least 30 days before the meeting date,
regardless of the issues on the agenda, if a longer period is
not required by law
Not applicable The decision-making
process relies on the Sole
Shareholder
2. Access of the shareholders to the list of people entitled to
attend the General Shareholders’ Meetings, starting from
the date of the announcement of a General Shareholders’
Meeting until the closing of a General Shareholders’
Meeting held in person, and, in the event of a General
Shareholders’ Meeting held remotely, until the deadline for
the collection of voting ballots
Not applicable The decision-making
process relies on the Sole
Shareholder
3. Access of the shareholders to information (materials) must
be provided during the preparation for the General Shareholders’
Meetings through electronic means of communications,
including the Internet
Observed  
4. Possibility for a shareholder to put an issue on the agenda
of a General Shareholders’ Meeting or require a General
Shareholders’ Meeting to be called without presenting an
extract from the Shareholder Register where the title to
shares is recorded in the shareholder register system, and
by presenting only a statement from the deposit account
where the title to shares is recorded in the deposit account
Observed  
5. Availability of the requirement in the Articles of Association
or in-house documents of the Company for the mandatory
presence of the General Director, members of the Governing
Board, members of the Board of Directors, members of
the Audit Commission, and the Company Auditor at the
General Shareholders’ Meeting
Not applicable The decision-making process relies on the Sole Shareholder
6. Mandatory presence of nominees for the positions of the
members of the Board of Directors, the General Director,
the members of the Governing Board, the members of the
Audit Commission, and the Auditor during considerations
by the General Shareholders’ Meeting of their election and
appointment
Not applicable The decision-making process relies on the Sole Shareholder
7. Availability of in-house documents of the Company regarding
the registration procedure for the participants in the
General Shareholders’ Meeting
Not applicable The decision-making process relies on the Sole Shareholder
Board of Directors
8. Provision by the Company’s Articles of Association for the
authority of the Board of Directors to approve annual
financial and economic plan of the Company
Observed Sec. 23, para 13.2 of the
Company’s Articles of
Association (AoA)
9. Availability in the Company of a risk management procedure
approved by the Board of Directors
Not observed The unified sectoral risk
management system is
approved at the level of
ROSATOM and introduced
by order of the General
Director of the Company
10. Provision by the Company’s Articles of Association for the
right of the Board of Directors to decide on suspending the
authorities of the General Director appointed by the General
Shareholders’ Meeting
Observed Sec. 20, para 13.2
of the AoA
11. Provision by the Company’s Articles of Association for the
right of the Board of Directors to establish requirements
for the qualification and the level of compensation with
respect to the General Director, the members of the
Governing Board, and the heads of the major divisions of
the Company
Not observed Not stipulated by the Company’s AoA
12. Provision by the Company’s Articles of Association for the
right of the Board of Directors to approve the terms and
conditions of contracts with the General Director and the
Governing Board members
Not observed Not stipulated by the Company’s AoA
13. Provision by the Company’s Articles of Association and
in-house documents for the requirement that the votes of
the Board of Directors members who act as the General
Director and the Governing Board members should not be
taken into account when the terms and conditions of
contracts with the General Director (management organisation,
manager) and the Governing Board members are
approved
Not observed Not stipulated by the Company’s AoA
14. Presence on the Board of Directors of at least three
independent directors who meet the requirements of the
Code of Corporate Conduct
Not observed Board of Directors composition
is determined based
on a decision made by the
Sole Shareholder of the
Company
15. Absence on the Board of Directors of any people condemned
of having committed offences in the field of
business or crimes against the public authorities, against
the interests of the federal, regional, and local Government
authorities, or who have been penalised for offences in the
sphere of entrepreneurship or finance, taxes, and levies,
and the securities market
Observed Implemented
16. Absence on the Board of Directors of people who act as
members, the General Director (manager), members of the
governance body, or employees of any competitor of the
Company
Observed Implemented
17. Availability in the Company’s Articles of Association of a
requirement that the Board of Directors should be elected
by cumulative vote
Not applicable Due to the Sole Shareholder
18. Availability in the in-house documents of the Company of
an obligation that the members of the Board of Directors
refrain from any actions which will or potentially may result
in a conflict of interests between them and the Company, or
should such conflict occur, disclose information about such
conflict to the Board of Directors
Not observed  
19. Availability in the in-house documents of the Company of
the requirement that the members of the Board of Directors
are responsible to notify the Board of Directors in
writing of their intent to make transactions with securities
of a company with which they are members of the Board of
Director, or its subsidiaries (affiliated companies), and
disclose information on such transactions with such
securities
Not applicable Members of the Board do not hold shares of the Company or its A&S
20. Availability in the in-house documents of the Company of a
requirement that the meetings of the Board of Directors
should be held at least once every six weeks
Not observed  
21. Holding of meetings of the Company’s Board of Directors in
the year for which the Company’s annual report is prepared,
with a frequency of at least once every six weeks
Not observed  
22. Availability in the in-house documents of the Company of a
procedure for holding meetings of the Company’s Board of
Directors
Observed Section 7 of the Provision
on the Board of Directors
23. Availability in the in-house documents of the Company of a
requirement for the approval by the Board of Directors of
the Company transactions for a sum of 10% or more of the
Company assets value, other than those committed in the
regular course of business
Not observed Not stipulated by the Company’s AoA
24. Availability in the in-house documents of the Company of
the right of the members of the Board of Directors to
receive information, as may be necessary for the performance
of their functions, from the executive bodies and
managers of major divisions, and the liability of the latter
for the failure to provide such information
Observed Para 3.1.1 of the Provision
on the Board of Directors
25. Existence of a strategic planning committee within the
Board of Directors or delegation of the functions of such
committee to any other committee (other than the Audit
Committee or the HR and Benefits Committee)
Not observed At this time, the Board of
Directors’ committees have
not been set up
26. Existence of a committee (Audit Committee) of the Board of
Directors that recommends an external auditor to the
Board of Directors and communicates with the external
auditor and the Company’s Audit Commission
Not observed At this time, the Board of
Directors’ committees have
not been set up
27. Presence of only independent and non-executive directors
in the Audit Committee
Not applicable At this time, the Audit
Committee has not been
set up
28. Leadership of the Audit Committee is by an independent
director
Not applicable At this time, the Audit
Committee has not been
set up
29. Provision in the in-house documents of the Company of the
right of access of all Audit Committee members to any
documents or information of the Company based on the
condition of non-disclosure of confidential information
Not applicable At this time, the Audit
Committee has not been
set up
30. Establishment of a committee (a HR and Benefits Committee)
within the Board of Directors that is responsible for
determining the criteria for the selection of nominees to
the Board of Directors and developing the Company’s
benefit policies
Not observed At this time, the Board of
Directors’ committees have
not been set up
31. Leadership of the HR and Benefits Committee by an
independent director
Not applicable At this time, the HR and
Benefits Committee has
not been set up
32. Absence of the Company’s executive staff in the HR and
Benefits Committee
Not applicable At this time, the HR and
Benefits Committee has
not been set up
33. Establishment of a risk management committee of the
Board of Directors or delegation of the functions of such a
committee to any other committee (other than the Audit
Committee or the HR and Benefits Committee)
Not observed At this time, the Board of
Directors’ committees have
not been set up
34. Establishment of a corporate conflict settlement committee
of the Board of Directors or delegation of the functions
of such a committee to any other committee (other than the
Audit Committee or the HR and Benefits Committee)
Not observed At this time, the Board of
Directors’ committees have
not been set up
35. Absence of the Company’s executive staff in the Corporate
Conflict Settlement Committee
Not applicable At this time, the Corporate
Conflict Settlement Committee
has not been set up
36. Leadership of the Corporate Conflict Settlement Committee
by an independent director
Not applicable At this time, the Corporate
Conflict Settlement Committee
has not been set up
37. Availability of the Company’s in-house documents approved
by the Board of Directors that establishes the procedure
for the forming and operating committees of the Board of
Directors
Not observed At this time, the Board of
Directors’ committees have
not been set up
38. Provision in the Company’s Articles of Association of a
procedure for determining the quorum of the Board of
Directors that makes it possible to ensure the obligatory
participation of independent directors in the Board’s
meetings
Not observed There are no independent
members on the Board of
Directors
Executive bodies
39. Availability of a collegial executive body (Governance) of the
Company
Not observed Sec. 11.1 of the Company’s
AoA stipulates only the Sole
Executive Body, i.e. the
General Director
40. Provision in the Company’s Articles of Association or
in-house documents of a requirement for the approval by
the Governing Board of real estate or loan transactions of
the Company, unless such transactions are major deals or
are made in the course of regular business
Not applicable Sec. 11.1 of the Company’s
AoA stipulates only the Sole
Executive Body, i.e. the
General Director
41. Availability in the in-house documents of the Company of a
procedure for the approval of transactions that fall beyond
the scope of the Company’s financial and operational plan
Not observed  
42. Absence in the executive bodies of people who act as
members, the General Director (manager), members of the
governing body, or staff members of any competitor to the
Company
Observed Implemented
43. Absence in the executive bodies of people condemned for
having committed crimes in the field of business; offences
against the Government, or against the interests of the
federal, regional, and local Government authorities; or who
have been subjected to administrative penalties for offences
in the field of entrepreneurship or in the field of finance,
taxes, and levies, and the securities market. Where the
functions of the sole executive body are performed by the
managing organisation or the manager, the compliance of
the General Director or the members of the management
board of the managing organisation or the manager with
the requirements established with respect to the General
Director and the members of the Governing Board of the
Company
Observed Implemented
44. Availability in the Company’s Articles of Association or
in-house documents of a prohibition for the governing
organisation (manager) to perform similar functions in a
competitor company or have any other property relations
with the Company other than the provision of governance
services
Not observed  
45. Availability in the in-house documents of the Company of
the obligation of the members of executive bodies to
abstain from any actions that will or potentially may lead to
a conflict of interests with the Company and, in the event of
such conflict, the obligation to inform the Board of Directors
thereof
Not observed  
46. Availability in the Company’s Articles of Association or
in-house documents of criteria for selection of the management
organisation (manager)
Not observed  
47. Provision by executive bodies of monthly reports on their
activities to the Board of Directors
Not observed  
48. Provision in the contracts made by the Company with the
General Director (governing organisation, manager) and
the members of the Governing Board on liability for
breaching clauses concerning the use of confidential and
need-to-know information
Observed  
Company Secretary
49. Existence within the Company of a special official (Company
Secretary) whose function is to ensure that the Company’s
bodies and officials comply with the procedural requirements
that guarantee that the legal rights and interests of
the Company shareholders are exercised
Observed The Company has a
Secretary of the Board of
Directors
50. Availability in the Company’s Articles of Association or
in-house documents of a procedure for the appointment
(election) of the Company Secretary and of the responsibilities
of the Company Secretary
Observed Sec. 27, para 13.2 of the
Company’s AoA and paras
4.1 and 4.2 of the Provision
of the Company’s Board of
Directors
51. Availability in the Company’s Articles of Association of
requirements for a candidate for the position of the Company
Secretary
Not observed Not stipulated by the Company’s AoA
Material corporate acts
52. Availability in the Company’s Articles of Association or
in-house documents of the Company of a requirement for
the approval of any major transaction before it is committed
Not observed Not stipulated by the Company’s AoA
53. Mandatory participation of an independent valuator in the
assessment of the market value of any property that is an
object of major transactions
Not observed Valuation is carried out in
accordance with Articles
77–78 of Fed. Law “On Joint
Stock Companies”
54. Availability in the Company’s Articles of Association, in the
event of the acquisition of major stakes in the Company
(takeover), of a prohibition to undertake any actions aimed
at the protection of interests of the executive bodies
(members of such bodies) or the members of the Board
of Directors, as well as the actions that worsen the position
of shareholders against their current position (in particular,
the prohibition for the Board of Directors to decide on the
issue of additional shares, securities convertible into
shares, or securities granting the right to acquire shares
in the Company before the end of the expected time of the
acquisition of shares, even if the right to decide so is
granted by the Company’s Articles of Association)
Not applicable There is a Sole Shareholder
of the Company
55. Availability in the Company’s Articles of Association of a
requirement for the obligatory involvement of an independent
appraiser in determining the current market value of
shares and potential changes in their market value as a
result of takeover
Not observed  
56. Unavailability in the Company’s Articles of Association of
an exemption of the buyer from the obligation to offer the
buy-out of the Company’s ordinary shares (other securities
convertible into ordinary shares) to the shareholders upon
takeover
Not observed There is a Sole Shareholder
of the Company
57. Availability in the Company’s Articles of Association or
in-house documents of the mandatory requirement for the
involvement of independent valuators in determining the
ratio for the conversion of shares in the event of reorganisation
Not observed  
Information disclosure
58. Availability of an internal document approved by the Board
of Directors that defines policies and procedures used by
the Company in the disclosure of information (Provision on
the Information Policy)
Observed

The Provision on Mandatory
Public Disclosure of
Information of JSC Techsnabexport
(approved by the
Board on 30.01.2013)

59. Availability in the in-house documents of the Company of a
requirement for the disclosure of information on objectives
of the placement of shares, on people who intend to acquire
the shares placed, including major stakes, and on participation
of the Company’s officials in the acquisition of the
shares placed
Not observed Not stipulated by the
Company’s AoA or the
Provision on Mandatory
Public Disclosure of
Information
60. Availability in the in-house documents of the Company of a
list of information, documents, and materials to be made
available to the shareholders for deciding on the issues
submitted for the consideration of the General Shareholders’
Meeting
Not observed There is a Sole Shareholder
of the Company
61. Existence of the Company’s website and regular disclosure
of information about the Company on this website
Observed www.tenex.ru and
www.e-disclosure.ru/
portal/company.aspx-
?id=6144
62. Availability in the in-house documents of the Company of a
requirement for the disclosure of information on the
Company’s deals with the people who act as senior executives
of the Company in accordance with the Company’s
Articles of Association, and on the Company’s deals with
the entities where senior executives of the Company hold
directly or indirectly no less than 20% of the share capital
or on which such people may otherwise exercise major
influence
Not observed Not stipulated by the
Company’s AoA or the
Provision on Mandatory
Public Disclosure of
Information
63. Availability in the in-house documents of the Company of a
requirement for the disclosure of information about all
transactions that may influence the market value of the
Company’s shares
Not observed Not stipulated by the
Company’s AoA or the
Provision on Mandatory
Public Disclosure of
Information
64. Existence of an internal document approved by the Board of
Directors on the use of essential information about the
activities, shares, or other securities of the Company and
the transactions with such shares and other securities,
which is not publicly available and the disclosure of which
may have major impacts on the market value of the shares
and other securities of the Company
Not observed  
Control of financial and economic activities
65. Existence of internal control procedures for the financial
and operational activities of the Company approved by the
Board of Directors
Observed  
66. Existence of a special division in the Company that is
responsible for the implementation of the internal control
procedures (control and audit service)
Observed The Company has set up a
special unit, i.e. the Internal
Control and Audit
Department
67. Availability in the in-house documents of the Company of a
requirement for the structure and composition of the
internal control and audit service to be defined by the
Board of Directors
Not observed  
68. Absence in the internal control and audit service of people
condemned for having committed crimes in the field of
business, or against the Government, or against interests
of the federal, regional, and local Government service; or
who have been subjected to administrative penalties for
offences in the field of entrepreneurship or in the field of
finance, taxes, and levies, and the securities market
Observed Implemented
69. Absence in the internal control and audit service of any
people who act as members of executive bodies of the
Company, or as members, the General Director (manager),
members of the governing bodies, or staff members of any
competitor of the Company
Observed Implemented
70. Availability in the in-house documents of the Company of
fixed dates for the submission of documents and materials
to the internal control and audit service for the assessment
of financial and operational transactions performed, and
the liability of officials and employees of the Company for a
failure to provide these on time
Not observed All documents are
submitted within
reasonable time or within
the time set up by the
control and audit service
71. Availability in the in-house documents of the Company of
the obligation of the internal control and audit service to
communicate any violations revealed to the Audit Committee,
and, if there is no such committee, to the Board of
Directors
Not observed  
72. Availability in the Company’s Articles of Association of a
requirement for the prior assessment by the internal
control and audit service of the practicality of transactions
not envisaged by the Company’s financial and operational
plan (non-standard transactions)
Not observed Not stipulated by the Company’s AoA
73. Availability in the in-house documents of the Company of a
procedure for the approval of a non-standard transaction
by the Board of Directors
Not observed  
74. Availability of an in-house document approved by the Board
of Directors that defines the procedure for audits of the
financial and economic activities of the Company by the
audit commission
Not observed The inspection procedure
of financial and economic
activities of the Company by
the Audit Commission is
defined in the Provision on
the Audit Commission
(approved by the decision of
the Sole Shareholder of
22.12.2009)
75. Assessment by the Audit Committee of the auditor’s report
before it is submitted to the shareholders at the General
Shareholders’ Meeting
Not applicable There are no committees of
the Board of Directors
Dividends
76. Availability of an in-house document approved by the Board
of Directors to be used as the guidance for the Board of
Directors in developing recommendations as to the amount
of dividends (Provision on the Dividend Policy)
Not observed  
77. Existence in the Provision on the Dividend Policy of a
procedure for determining a minimum share of the Company’s
net profit used for the payment of dividends, and of the
conditions under which dividends are not paid or are not
paid in full on preferred shares, for which the size of
dividends is determined in the Company’s Articles of
Association
Not applicable The Company does not have
an approved dividend policy
78. Publication of information on the Company’s dividend
policies and any amendments thereto in the periodical
issued as specified in the Company’s Articles of Association
for the publication of announcements of the General
Shareholders’ Meetings and on the Company’s online
website
Not applicable The Company does not have
an approved dividend policy


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